Welfare Reform on the Web (October 2003): National Health Service - Funding

BOND ON THE RUN

M. Hellowell

Health Service Journal, Vol. 113, September 18th 2003, p.31

Most new hospitals being built under the private finance initiative attract
investment through the provision of index-linked bonds, returns on which are tagged
to inflation. A radical lessening of investors' willingness to channel their money
into these bonds had hit PFI projects hard.

CALL OF THE WILD

D. Carlisle

Health Service Journal, Vol. 113, September 18th 2003, p.12-13

The new independent sector treatment centres run under contract to the NHS
by private providers will shake up the UK health economy. They promise to undercut
existing UK independent providers and will hit consultants by taking away their
private work.

HIGHER RATES FOR FAST-TRACK CARE

J. Carvel

Guardian, Sept. 11th 2003, p.6

Government is to pay overseas for-profit healthcare providers premium rates
to run the new fast-track diagnostic and treatment centres. Ministers have accepted
that the centres will not be profitable enough to attract foreign companies unless
prices are well in excess of the standard NHS tariff.

HOSPITALS FACE £700M CASH CRISIS

H. Carter

The Guardian, September 5th 2003, p.12

Health services in Greater Manchester, where people's health is amongst the
worst in the country, could collapse by 2005 as their financial deficit increases.
The crisis, which has been blamed on the cost of private finance initiatives for
large building projects, could cause various new schemes, such as Manchester's
£420m hospital in the heart of the city, to be cut.

ON A ROLL

J. Davis

Health Service Journal, Vol. 113, September 18th 2003, p.32-33

Over the past five years the National Lottery New Opportunity Fund (NOF) has
distributed £750m for health improvement projects. Presents a case study
of NOF funded projects run by Morecambe Bay Primary Care Trust.

OPEN SEASON

N. Plumridge

Health Service Journal, Vol. 113, September 4th 2003, p.27

NHS finance departments will be exposed to competition both from shared service
centres and commercial providers. Both of these can offer reduced processing costs
arising from investment in technology and have spare capacity.

PAYMENT BY NUMBERS

N. Plumridge

Public Finance, September 19-25, 2003, p.20

While foundation hospitals have dominated the headlines, government plans to
introduce funding changes to the NHS have slipped in almost unnoticed. However,
the changes proposed in the consultation document Payment by results will create
an "internal market" in the NHS. NHS commissioning bodies will purchase
healthcare via a national tariff that specifies the value of each clinical procedure.
Hospitals will therefore be paid by results. However, failure to deliver the required
level of activity will result in funding being withdrawn, causing alarm amongst
hospital trusts.

SHOULD GENERAL PRACTITIONERS PURCHASE HEALTH CARE FOR THEIR PATIENTS? THE TOTAL
PURCHASING EXPERIMENT IN BRITAIN

S. Wyke and others

Health Policy, Vol. 65, 2003, p.243-259

The paper presents evidence from the UK total purchasing experiment, which
was the first major quasi-market development in the NHS to be independently evaluated
from the outset. Total purchasing gave volunteer groups of GP practices freedom
to purchase all hospital and community health services for their patients. Evidence
suggests that while GPs have great potential as purchasers, they also have considerable
limitations. The expectation that they will be able to improve the quality of
patient care, or to alter the use of resources, may be more appropriate where
the task is to alter the balance or location of care between hospital and extramural
settings. However, budgetary incentives are not "magic potions" which
have a similar effect wherever they are introduced.

SNIFFING OUT THE ELUSIVE CASH TRAIL

S. Brown

Primary Care Report, Vol. 5, No. 14, September 10th 2003, p.8-11

Introduces the Department of Health's new national programme budget project.
This aims to map all primary care trust expenditure to programmes of care based
on medical conditions such as diabetes, coronary heart disease or poisoning.

TREATMENT CENTRES RAISE SPECTRE OF PRIVATISATION

S. Ward

Public Finance, September 19-25 2003, p.13

Health secretary John Reid yesterday announced a short list of preferred bidders
from the private sector who will provide elective surgery- totalling around 160,000
non-urgent operations a month. The operations will be provided in Treatment Centres,
where the companies will also offer diagnosis and general surgery. It is hoped
that the treatment centres will be operational by next year. However the announcement
has angered Unison as the private providers will initially be given higher payments
to allow them to establish the service. NHS managers are also concerned about
the new units poaching NHS staff.